Movie Theaters Are Thinking About Making Their Own Movies

With last year's Alice in Wonderland, Disney decided to try something new:
release the DVD weeks earlier in an attempt to reverse flatlining home video sales. Unsurprisingly, theater chains--who typically reap a
larger percentage of box office revenues in the later weeks of a film's
release--hated the idea, because it signaled the studios' desire to
eventually cut them out of the game and engage with moviegoers directly.

The 3D Alice's substantial
theatrical returns calmed both parties. Now, though, it looks like the two largest theater chains, AMC and Regal
entertainment, have decided to go on offense.

As reported by the Los Angeles Times,
AMC and Regal will form a venture to distribute independent films,
potentially disrupting the partnership they now have with the studios
and "encroaching" on studio turf. The chains will focus on acquiring
films that typically do not get a traditional wide-release in theaters,
"such as low-budget dramas, comedies and horror pictures." The point is
to increase the sheer amount of product in theaters at the
same time that major studios are slashing their own movie rosters to focus
on tentpole releases (like Transformers, Iron Man) that generate higher ancillary revenue
streams.

Interestingly, the move by AMC and Regal arrives on
heels of Time Warner's (the parent company of Warner Bros. studios)
decision to "launch a premium video-on-demand service" that will again shorten the DVD release window and possibly eat into theater chains revenues.

As
for moviegoers? The wrangling between studios and theater chains may
create an even-more fractured cinematic landscape. It's not a stretch to
imagine a scenario in the near future where studios beam their latest tentpole
release straight to household 3D TVs, while struggling theater chains
try to lure moviegoers with exclusive, independent films--and try
to peddle $10 popcorn.